Have an interview coming up which is where this stems from. I understand the concept of Warehouse Lending but have a few questions.
Who are your customers? would a BB bank really need a Warehouse Lender? It seems like it would only be one off guys and smaller companies.
Are you considered FO? it feels like a MO role.
Do you get paid well?
what is life after warehouse lending like? i feel like it'd be hard to leverage your skill set elsewhere, however, you can probably leverage contacts within the industry to start a debt fund on minimal capital.
Are there deal toys :p
Customers are non bank mortgage lenders who originate to sell mortgages. If you are an rm it is fo because you have to go find more companies to lend to. There likely are not deal toys. Who knows where your career will take you afterwards.
Fair enough... thanks for the response. do you know about pay?
GS?
yes...
know anything?
Answers to your questions:
1) A BB is a warehouse lender, and would not need one (a few exceptions). Warehouse Lending (WL) clients are pretty much anyone on the buy-side: hedge-funds, private equity, specialty finance, etc.
2) Depends. Most senior levels are def FO, but associate and below is probably more akin to MO.
3) Depends, but usually not great.
4) The probability of starting a debt fund by leveraging contacts working only in WL is pretty much 0. Life after it depends on how much you take from it, and what you make of that.
5) WLs don't get deal toys.
Very helpful - thanks for all your insight.
What exactly is a "deal toy"?
Hard to post photos here, but Google "deal toy lucite". Sometimes you get a VP who wants to get super creative with the deal toy, but 90% of the time it's just an engraved piece of glass or an engraved bottle of alcohol.
That explains it
I have a similar question. Is the move from Rating Agency to Warehouse Lending in a bank a good option? What are some of the pros and cons? Plus they interviewed me for a VP position but then said I would qualify for an associate position. Should I go for it?
itsanumbersgame are you in a place where you can opine on a role like this?
Nope, but its amazing to read what I didn't know just 4 years ago
That’s encouraging… sometimes I feel overwhelmed by how little I know.
Wondering if I could run a few desks by you while I have you. It’s a rotational program so this would only be my first desk. My interests lie in securitized / structured products. I’m at a top 3 BB in the space.
1. Non-Agency RMBS
PROS: the associate loves me and he’s cool. The product is sexy and interesting. Probably has the best chances of HF exits if I’m into that.
CONS: very complex. Steep learning curve. Director of team is a stud but I think the only reason I’m here is because the Associate loves me.
2. CMBS Structuring
PROS: structuring role is ideal for my first rotation as I’m trying to learn that process. I also prefer more of a deal-based environment (I think). Heavier on the excel modeling which I like.
CONS: from other CMBS threads I don’t think you love this space… but personally it’s mainly about the hours being a little long and I’m not quite as close with the team.
3. Spread Product / Structured Product Repo
PROS: MD on this desk loves me and is super nice / well connected. Could bode well for building my network and getting on a favorable desk second rotation. Additionally because it’s repo I’m exposed to virtually all spread / structured products.
CONS: arguably the “least sexy” / most subject to automation down the line.
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